When a country's labor market is in equilibrium in the specific factors model, the wage rate
A) will be the same in both sectors.
B) will be higher in the export-competing sector.
C) will be higher in the import-competing sector.
D) will be higher in the sector where product price is higher.
E) will be higher in the sector where product price is lower.
A
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The classical model predicts that, in the short-run, a tax cut financed by an increase in the money supply would
a. leave output and the price level unchanged. b. increase the price level but leave output unchanged. c. increase output but and reduce the price level. d. increase output and the price level by increasing aggregate demand. e. None of the above.
If nonmarket work is a normal good, then an increase in income __________ the time allocated to __________
a. decreases; market work b. decreases; leisure c. increases; market work d. increases; leisure e. increases; nonmarket work